WASHINGTON D.C. – United States President Donald Trump has proposed a series of bold and unconventional economic relief measures, including direct payments of $2,000 to many Americans and the introduction of 50-year home mortgages, as his administration confronts rising voter anxiety over the cost of living. These proposals, floated ahead of the critical 2026 midterm elections, signal a recognition within the Republican Party of the political risks posed by persistent inflation and affordability challenges.

The suggestions come on the heels of Democratic victories in off-year elections where economic concerns were a dominant issue for voters. Despite previously dismissing affordability concerns, the Trump administration is now actively seeking to address the economic pressures facing American households. The annual inflation rate in the U.S. stood at 3.0% for the 12 months ending September 2025, with rising costs for essentials like groceries, housing, and healthcare remaining a central concern for the public.

Proposed Economic Interventions

One of the most prominent ideas is a proposal to send dividend cheques of approximately $2,000 to low- and middle-income Americans. President Trump suggested on social media that these payments would be funded by revenue from the extensive tariffs his administration has imposed on imported goods. However, economists and policy experts have raised serious questions about the financial viability of this plan. According to the non-partisan Committee for a Responsible Federal Budget, the dividend program could cost up to $600 billion, far exceeding the projected tariff revenue. Erica York of the Tax Foundation calculated that payments to 150 million eligible adults would require roughly $300 billion, more than double the $120 billion in new tariff revenue collected so far. There are also concerns that such an injection of cash could fuel further inflation, undermining the policy's intent.

Another proposal floated by the President is the creation of 50-year mortgages, a significant extension from the current 30-year standard. The stated goal is to lower monthly housing payments, making homeownership more accessible. While a longer loan term would reduce monthly payments—by an estimated $100 to $250 on a typical home—financial analysts warn of substantial long-term costs. A borrower with a 50-year mortgage would pay significantly more in total interest over the life of the loan, potentially nearly double that of a 30-year mortgage, and would build equity at a much slower pace. The idea, reportedly originating from Federal Housing Finance Agency Director Bill Pulte, has drawn criticism even from within Trump's own political base, who argue it would primarily benefit banks.

Implications for Kenya and East Africa

While these policy debates are unfolding in a domestic American context, their outcomes carry significant weight for global partners like Kenya. The U.S. is a critical economic ally for Kenya, with total trade in goods and services estimated at $3.3 billion in 2024. An unpredictable U.S. economic strategy, particularly one involving aggressive tariff policies, introduces considerable uncertainty for Kenyan exporters.

The Trump administration's implementation of a blanket 10% tariff in April 2025 has already strained this relationship by effectively nullifying the benefits Kenya enjoyed under the African Growth and Opportunity Act (AGOA), which is set to expire in September 2025. This has threatened key Kenyan export sectors, such as textiles and apparel, which could see profit margins eroded and competitiveness diminished in the U.S. market. The Central Bank of Kenya has estimated potential annual export revenue losses of up to $100 million.

Furthermore, a looser U.S. monetary policy, which President Trump has advocated for, could lead to a stronger U.S. dollar. This would exert downward pressure on the Kenyan Shilling, potentially increasing the cost of imports and fueling domestic inflation. Changes in U.S. foreign aid, a cornerstone of support for Kenya's health and development sectors, also remain a concern amid the "America First" policy orientation.

As the U.S. navigates its economic challenges ahead of the 2026 elections, Kenyan policymakers and businesses will be monitoring developments closely. The need to diversify export markets and strengthen intra-African trade through frameworks like the African Continental Free Trade Agreement (AfCFTA) has become increasingly urgent to mitigate the risks associated with U.S. policy volatility.